I’VE NOTED REPEATEDLY that gas prices don’t seem to be high enough to affect people’s behavior. Apparently they’d have to increase a lot more to do that:
In 1962 — a year writ large in the popular imagination as the quintessential year of muscle cars and cheap gasoline thanks to the movie American Graffiti — gasoline prices averaged 31 cents per gallon. When we factor changes in disposable income, todayâ€™s gas would have to cost $4.48 to be a comparable burden.
The public likewise thinks of 1972 as the last year of energy innocence prior to the rise of OPEC and the onset of shortage. Fuel prices in 1972 averaged 36 cents per gallon, a hefty $2.77 per gallon in todayâ€™s terms. While still high, this price is not all that different than the prices we were paying earlier in the year.
No wonder people are still driving fast and often.